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Ahluwalia Contracts (India) Ltd
Earnings Call Analysis
Q2-2025 Analysis
Ahluwalia Contracts (India) Ltd
In Q2 FY '25, Ahluwalia Contracts India Limited reported a turnover of INR 1,011.48 crores, reflecting a decline of 12.19% compared to INR 1,151.55 crores in Q2 FY '24. The operating profit showed more significant strain, with a profit after tax (PAT) of INR 38.36 crores, down 30.63% from INR 55.30 crores in the same quarter last year. The earnings per share (EPS) also fell, from INR 8.26 to INR 5.73. The EBITDA margin decreased to 7.25% from 9.96%, while the PAT margin dropped from 6.13% to 3.79%. This indicates that the company is experiencing rising costs without a commensurate rise in revenue.
For H1 FY '25, the company achieved a turnover of INR 1,930.83 crores with a PAT of INR 68.96 crores, compared to INR 1,665.16 crores and a PAT of INR 105.03 crores in H1 FY '24. The EPS decreased from INR 15.66 to INR 10.29. The EBITDA margin also fell, from 10.36% to 6.93%, and the PAT margin decreased from 6.31% to 3.57%. This pattern of decreasing profitability suggests challenges from rising costs and lower efficiency in operations.
As of September 30, 2024, Ahluwalia's net order book stood at INR 16,193.45 crores, expected to be executed over the next 2 to 2.5 years. The total order inflow for FY '25 reached INR 7,794.37 crores, indicating robust demand despite recent performance struggles. The management provided guidance for a revenue growth target of 15% for FY '25, with the potential to achieve between 15-20% growth in FY '26. This reflects confidence in their existing projects and forthcoming opportunities.
Currently, the management anticipates that the EBITDA margin will decline to around 9% for FY '25, owing to rising costs and operational inefficiencies. However, they expect improvements in FY '26 as major design-build projects progress. Overall, they aim to return to double-digit margins driven by enhanced operational stability and effective cost management.
The company is expanding into sectors such as industrial construction and airports, while maintaining a balanced focus on residential and commercial projects. Future order sizes are expected to range around INR 500 to 1,000 crores, and the target is to maintain a balanced 50-50 split between government and private contracts. The current bid pipeline is estimated at INR 5,000 crores, reflecting strategic planning to stabilize and grow the business.
On specific projects like the CST redevelopment, the management has indicated a targeted revenue run rate of about INR 70-80 crores per month starting from early 2025, which will contribute significantly to their overall revenue. Other projects, like the Tata Memorial Hospital, are also expected to pick up pace after resolving design-related challenges.
To tackle rising expenses, the company has incorporated escalation clauses in their contracts, ensuring they can pass some increasing costs onto customers. Despite facing a labor shortage exacerbated by ongoing elections and seasonal weather, management believes that advances in their execution capabilities will mitigate some of these challenges in the future.
Ahluwalia Contracts faces short-term challenges marked by lower revenue and margin declines, yet the overall order book remains healthy, with strategic growth targets in place. Investors should watch the upcoming quarters for improvements in execution, particularly in major projects, and a recovery in margins to ascertain specific investment entry points.
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Ladies and gentlemen, good day, and welcome to the Ahluwalia Contracts India Limited Q2 FY '25 Earnings Conference Call hosted by AMBIT Capital. [Operator Instructions]
Please note that this conference is being recorded. I now hand the conference over to Mr. Dhruv Jain from AMBIT Capital. Thank you, and over to you, sir.
Thank you. Hello, everyone. Welcome to the Q2 FY '25 Earnings Call of Ahluwalia Contracts India Limited. From the management side today, we have with us Mr. Shobhit Uppal, Deputy Managing Director; Mr. Vikas Ahluwalia, Director; and Mr. Satbeer Singh, Chief Financial Officer.
Thank you, and over to you, sir, for your opening remarks.
Thank you, Dhruv. Good afternoon, everybody. Ahluwalia Contracts India Limited has announced financial results for Q2 FY '25. During this quarter, Q2 FY '25, the company has achieved a turnover of INR 1,011.48 crores and a PAT of INR 38.36 crores in comparison to a turnover of INR [ 901.55 ] crores and a PAT of INR 55.30 crores in Q2 of FY '24.
The company has registered a growth and degrowth of 12.19% and minus 30.63% in turnover and PAT, respectively, during Q2 FY '25 in comparison to Q2 FY '24. EPS of the company for Q2 FY '25 is INR 5.73 as compared to INR 8.26 in Q2 FY '24. During Q2 FY '25, the company's EBITDA margin is 7.25% as compared to 9.96%, and a PAT margin of 3.79% as compared to 6.13% in the corresponding period of the last financial year.
During the H1 FY '25, the company has achieved a turnover of INR 1,930.83 crores and a PAT of INR 68.96 crores in comparison to a turnover of INR 1,665.16 crores and a PAT of INR 105.03 crores in H1 FY '24. EPS of the company for H1 FY '25 is INR 10.29 as compared to INR 15.66 in H1 FY '24. During [ HY1 ] FY '25, the company's EBITDA margin is 6.93% as compared to 10.36%, and a PAT margin of 3.57% as compared to 6.31% in the corresponding period of the last financial year.
Net order book of the company as on 30th September 2024 is INR 16,193.45 crores to be executed in the next 2 to 2.5 years. Total order inflow during FY '25 till 30th September 2024, INR 6,699.70 crores from 1/10/2024 til date, INR 1,094.67 crores. So total order inflow in this financial year till date is INR 7,794.37 crores. Thank you. We are ready to take questions.
[Operator Instructions]
We have the first question from the line of Shravan Shah from Dolat Capital.
Sir, just to recheck on the guidance front. So now for this FY '25 in terms of the revenue growth, and for FY '26, how much growth are we looking at? And also possibly on the margin front given the margin was very low in the 1H. So in the second half, how much margin are we looking at? And in FY '26, will it again go back to 11%?
So as far as our top line growth is concerned, we are seeking to a guidance about 15% growth. As far as our margin is concerned, we feel that we'll have to moderate it a bit. It will come below double digits now. It will be around 9%.
As far as the next financial year is concerned, since our order book is healthy in a lot of our design build projects, we feel will be in full swing in the next financial year, we should cross the double-digit margin barrier in the next financial year, that is FY '26.
Okay. And in terms of the revenue, will it be in FY '26, can we see more than a 20% kind of a growth?
Yes, it should be between 15% to 20%. We are targeting a 20% growth.
Okay. Got it. And in terms of the order inflow, now already we have received a significant INR 7,800-odd crores, including the recently one. So now how much more are we looking at by March? And if possibly, if you can share in terms of the bid pipeline and over our long-term vision was to have a 50-50 private government, which we are already there. So how we want to now go ahead?
Yes, that is what I have been mentioning in our last 2 or 3 con calls that we would like to maintain it at this level, at the 50-50 level. And going forward, we are actually consolidating. So in the rest of the 3, 4 months of this financial year, we're not bidding very aggressively, maybe another INR 1,000 crores inflow. And going forward, in the next financial year, maybe anywhere between INR 5,000 crores to INR 6,000 crores new orders.
Got it. And currently, the bid pipeline would be?
Currently, the bid pipeline as it stands, is about INR 5,000 crore.
Got it. And just a couple of data points on the balance sheet front, mobilization advance, retention money and unbilled revenue.
Yes, mobilization advance is INR 542 [ crores ] and unbilled revenue is INR 598 and retention is [ 335 ].
335. And just on the CapEx front, so already INR 92-odd crores and so once...
CapEx til 30th September, INR 101 crores has incurred.
So for full year, how much now we are looking at?
Given a guidance of about INR 130 crores, I think.
INR 175 crores.
And then the rest of the financial year, it should be about another INR 30 crores to INR 35 crores. That also we are revising it downwards.
We have the next question from the line of Amit Khetan from Laburnum Capital.
So we have a good order book currently, but if I were to look out over the next 2 to 3 years, what are the segments or areas you're most bullish on in terms of incremental new orders? Are there going to be new areas that we will participate in? Or is it going to be the current segment that we are in?
So Amit, we are -- as you would be aware, we are present in the entire spectrum of the building industry. So there are areas over a period of time, which we had not focused on because there was not much activity. We are now refocusing on industrial activity.
We've recently won an order with BALCO also. Airports is something which we continue to be bullish on. The government is continuing to spend on airports. So we already are executing 2 airports, which are in design build stage -- designing stage as we speak. And there are a couple of orders in the pipeline, which we are bidding on.
So that is another area that we are looking at. Commercial and retail activity is something that also excites us. We are focusing on that. So these are the areas. And residential activity, there is a lot happening, but we are now being a little wary. We already have a healthy exposure as far as residential projects go. So we are bidding sort of conservatively going forward as far as residential is concerned.
Got it. Got it. And this industrial sector that you talked about and airports, right, what are the typical order sizes like are these in the similar ticket size range of INR 500 crores to INR 1,000 crores? Or would it be much larger?
No, they are in this range only. As far as office infrastructure goes, the government is also coming out with larger orders for government office building using alternative technologies, they are INR 1,000-plus crores. That is an area which is of interest to us.
Understood. Understood. And secondly, in the last couple of quarters, you've been talking about a shortage of labor and things like that. Has that eased? Or do you see that continuing for the next few quarters?
No, that is continuing on account of various factors. As the country continues to be permanently in election mode, that's what we've been seeing since the general elections preparation for the general election started. So this labor problem continues as labor comes from a few areas geographically. And this continues then NGT issues such as NGT and rain, this continues to affect labor supply. So we feel that this will -- throughout this financial year, at least, and even in the first quarter of next year, this problem will continue to be there.
Got it. And would this also be a factor in margin contraction? Or is that just a function of operating leverage?
No, no, it's a huge factor.
[Operator Instructions]
The next question is from the line of Laxminarayan from Tunga Investments.
A few things. See, when you started the year, you actually alluded to a particular margin and then we stand at this point in time at a slightly lower margin level, right? Now what has actually passed -- I mean what has negatively surprised you when you actually grew up your budgets at the start of the year? And whether things have become a little unpredictable now than earlier? And how do you think it's becoming a little more predictable going forward?
So look, while one of the things which has surprised us in the past is the volatility in material cost, that we had catered for by building in escalations in our contracts. But a, on some of our larger order book -- larger contracts, which we have won in the last year or so, there are various factors which have hit us, which would not sort of within our control.
One is, of course, the prolonged monsoon across the country. Some of our biggest projects are in, say, places like Mumbai or Odisha or Bihar, right, where -- Assam, where the monsoons this year have been exceptionally heavy.
The turnover has been affected there. Then as I mentioned in my answer to the earlier question about the last 5, 6 months, the country has been in election mode. That has impacted the labor force availability on site. So this was something which was not expected. Thirdly, on some of our large contracts, the design part, approval, so to say, have been delayed for no fault of ours, which were beyond our control, [ CSTM ] being one such project, which is our largest project till date.
That has impacted our margins because our fixed overheads have continued to be there, and we've not been able to execute on the ground. So these are factors which have impacted our margin. And fourthly, some of these factors are generic or general to the industry, if you were to compare our margins with our peers, actually, we have done better than most of them. So we managed our cash flows better.
So -- but the industry, as such, has been affected and beset by some of these margins. Going forward, hopefully, in the next financial year, I don't think there'll be so much focus on electioneering, a lot of state elections would be behind us. Most of our large projects, the design is nearing completion. Approvals are mostly going to be in place. So hopefully, we'll have a clear run and our margins would be on the upswing again.
Got It. And in the last call, you mentioned that there has been a spurt in the subcontractor expenses as well, I think our employee expenses are both of them. Now -- and you said that only some of your contracts have a pass-through, you can actually pass these expenses. So right now, what kind of situation we are in? Has there been has any changes in the contract that you have passed on these expenses or how situation is looking now?
So most of our contracts now have built-in escalation clauses one way or the other. As far as the government -- most of our fixed price contracts are -- have been completed or are nearing completion. As far as the ongoing contracts are concerned, the government contracts, they have a built-in escalation clause or a standard clause based on wholesale price index.
As far as the private contracts go, all the volatile materials, the basic pricing is there for cement, steel, for [ brick ], stone aggregate, so on and so forth, even the finishing materials like stone, wood, et cetera. So as I said earlier, the volatility in these material is covered. And because we have a healthy order book, to a certain extent in the private sector, we are able to dictate terms in having a more balanced contract agreement and plugging in these.
Got it. Now if I just look at your current assets in the balance sheet and the trade receivables are something like INR 625 crores. Can you just tell me how do you classify these current assets? How much of them are payable within 6 months? Can you -- I mean, receivables within 6 months? If you can just throw some light on what is the aging of the receivables in your current assets?
What I could understand that there is basically INR 625 crores debtors that are current receivables. And that we are expecting within our normal days, the operational days that's coming around 60 days, 60 to 75 days that we are expecting to receive that.
More than [ 6 ] months.
One second. we'll give you.
And this is noncurrent, this is hardly INR 33 crores. I think so, which expecting realization of...
Anything with the current assets, sir?
Yes, please.
Current assets.
I think in the current assets, INR 625 crores. I just want to understand how much of your trade receivables are within 6 months and how much is beyond 6 months to 1 year? Less than 6 months and 6 months to 1 year?
This is INR 625 crores -- out of INR 625 crores, we are expecting around might be INR 100 crores more at upper side, just more than 6 months.
And the rest INR 525 crores will be within 6 months?
Yes, yes, within 6 months. Yes.
Okay. Okay. Sir, 1 more question regarding your -- you talked about fixed costs are slightly escalated. If I just look at your expenses, which are the ones are variable in nature. So if you look at it, the subcontract work is completely variable in nature. And how about the employee benefit expense, how much is variable and how much is fixed?
Variable as far as employee cost is concerned, variable is very less. As far as the variable is concerned, it's only for the top maybe out of a total employee strength of about 3,500, variable component would be only there for about 20 people who are -- who are the top level of management in the company.
Because your employee benefit expenses have actually kind of gone from around INR 70-odd crores for the first quarter, and to that almost INR 89 crores. So I just want to understand how -- what actually led to a substantial increase in the employee benefit expenses?
So two things. One is our employee cost includes labor -- labor cost also. So this is the labor, which is -- which the company is spending directly on. So there are 2 components to the labor. One is labor, which is under the subcontractor. And as a part of this INR 89 crores, there is labor which the company is directly spending on. Part of this increase is due to the increase in revenue and part of the increase is also...
Out of employee benefit, 22% labor.
Yes. So that's what I'm saying. And the other thing is we have increased -- we have paid arrears to the staff increments. Our staff increments, we put those increments in the last quarter and the arrears have been paid, right? This was due from 1st of Jan, but the process was delayed.
So part of that increase is due to that. And thirdly, obviously, the number of people, the number of staff has also increased to cater for our increased order book, where we are going to be executing the work over the next, say, 2, 2.5 years.
Got it. Got it. And any idea what is the band one should expect? Because this is like a one-off arrears, which has been taken into consideration.
So just to give you an idea, our staff cost per se, only our staff cost, if that is helpful to you is in the region of -- it varies from about 6.8% to 7.1%. And this is where it's been kept at over the past, say, 2 to 3 years.
Got it. And this is part of the employee benefit expense?
Yes. This is a part of the employee benefit expenses. Are you there?
Yes.
Okay. So you asked about specifically a question about the trade receivables, right? So our trade receivables are about 60 days as Mr. Satbeer said, right, which is one of the lowest in the industry today, right? I mean it goes on up to about -- so we have reduced also -- our net working capital days have reduced from 117 in the last quarter, that's Q1 of '25 to 93 days in the current quarter. That's an additional information for you.
The next question comes from the line of Parvez Qazi from Nuvama.
So a couple of questions from my side. As you rightly said, historically, our staff expenses have been between 6.8% to 7.1% whereas if one looks at H1 numbers, they are at about 8.8% or something. Now clearly, part of the reason is because of operating deleverage. As you rightly said, some of our projects because of various reasons haven't progress at the pace at which we would like.
So maybe part of the reason is also because of the industry-wide labor shortage. Now going ahead, do you think we should pencil in slightly higher than historical average for this? Or do you think this will normalize and come back to the 7%, 7.5% March, maybe 1 year down the line, 2 years down the line? Just wanted to get your thoughts on that.
We aim to get it down to anywhere between 7% to 7.5%. That is what our internal -- our planning is. But as I mentioned earlier, and you also sort of alluded to that, it all depends on our revenue, on our actual execution on the ground. Other than the factors that I've mentioned earlier, which have affected our work on the ground or production on the ground, one factor which will continue to impact us in this quarter, the ongoing quarter is the NGT, right?
So all of you are aware of what's happening in NCR. So now GRAP-IV is in place and -- so that is another thing, which is going to impact this quarter. That's why I've kept the margin guidance muted for the rest of the year, because we have a lot of large projects in NCR, especially Gurgaon.
Sure. My second question is, I mean, you said that for the CST redevelopment project, there are design issues and which hopefully will get resolved going ahead. But if I look at some of our other major projects like the Tata Memorial Hospital in Parel or the DLF Arbour Project, there also, the quarterly execution run rate seems to be somewhere around INR 25 crores, INR 30-odd crores only.
So you -- I mean, and in these projects also, are there some design issues or some other issues? And when do we expect a pickup in the pace of execution for these larger projects?
As far as the DLF Arbour Project goes, we are -- we actually -- we executed about INR 11 crores to INR 12 crores per month. Or last month, we achieved that run rate. And this month, we were on a target to achieve -- to double that. And then going forward, maintain about INR 25 crores every month.
But this quarter, as I said, now it will be impacted by NGT, but we are out of the ground there now. The design issues of design was not in our scope. It was in the client's scope, but there were a few issues there and labor shortage was there. But we -- I think as far as DLF goes, once the NGT issues are behind us, we are ready to take off.
As far as Tata is concerned, there, yes, there were design issues. But that also, I think within a month or so, we should be taking off on that project also.
Was the Tata Cancer Hospital is nearly on target now? I mean whatever time we have lost is because of the monsoon. So whatever were the design issues, they were more to do with the foundation part of it, which the Tata Memorial people had to redesign or do a little bit of changes because we encountered a certain blocks which was not there. That will be, otherwise Tata per se is on track.
Sure. My second question is, I mean, the overall industry -- I mean when we talk to real estate developers, they do highlight that there is a shortage of good quality contractors in India. Are you as well as some of your other peers in the building contracting space? Clearly have lifetime high order book. There is no shortage of order intake. So then the question is, I mean, in the previous cycle, 2002 to '08, we had seen a similar phase and all of you as well as your peers had seen significant expansion in EBITDA margin. Why do you think the similar situation is not playing out this time?
It's too early to sort of say whether those kind of margins will happen or not happen. All we can say is or to give you the reason for why they have not happened up until now as far as this financial year is concerned. I did mention all those reasons. Prolonged monsoon, electioneering, right? And all of a sudden, the infrastructure growth is upon us, and this kind of growth is unprecedented.
This was not even there in the last upturn. So labor shortage, the kind of labor shortage that we are seeing now, I mentioned in my last 2 calls that this is virtually an epidemic, which is waiting to be upon us.
So the government has to wake up and do something about upskilling of labor force, do something or change just the NREGA laws. So labor shortage until the government steps in, I don't think anything much is going to happen. So that is a major contributor to works not proceeding on schedule. And that, in turn, is affecting our not only our revenue -- projected revenues but also our margins. The industry is suffering, it's not only us. That's why I mentioned. If you see the results of all construction companies, all these factors have contributed.
Yes. Absolutely, sir. Last question to Satbeer Ji. Sir, what would be our gross debt level?
This is INR 9 crores.
We have the next question from the line of Vaibhav Shah from JM Financial.
EBITDA margin guidance for FY '25. What's the number?
About 9%.
Sir, what will drive that improvement in the second half, the margin improvement?
As we mentioned, some of the factors which have affected us till now, they are behind us. One is -- I think other than NCR, we should have a clear run execution, no monsoons are there. Once the Maharashtra elections are over, that sort of hold back should also not be there.
As far as NGT is concerned and NCR, this month or maybe December maybe a washout, but the last quarter, we should see a good run rate. We have -- most of our contracts have taken off now.
And out of our total order book, almost 30% comes from NCR. And our bigger projects like CSTM and Tata, as Vikas mentioned, the design phase is almost over. So we are looking for healthy revenue from these projects also. The 2 airports that we are doing, Varanasi and Darbhanga there also design phase is nearing completion. So in the last quarter of this financial year, we should see a good run rate from these projects also.
Okay. Sir, secondly, out of our total order book, what would be the share of fixed price contracts?
This is 15%.
And this should be completed by March, largely?
You can see -- yes, largely, this should be completed by March, almost totally, it will be over by H1 FY '26.
Okay. Okay. And sir, lastly, on a few projects. So for CST, now what would be our guidance for FY '25 in terms of revenue, and earlier, you were targeting completion of June '26. So would we be revising the numbers?
Vikas, do you want to answer that?
Come again, please.
For CST project, what would be your revenue guidance for the next couple of years? And you were targeting a completion of June '26 earlier. So are we maintaining that target?
So the project is actually about 3.5 years. And I mean, the execution time will probably remain the same. I mean, whatever time we lost, last 6 months, 8 months, because of design and approvals from the railways is lost, is lost. But it is going to be compensated for that. That is for sure.
Okay. So what revenue are we targeting for '25 and '26 from this project?
You can take an average run rate of about INR 80 crores. So some months it's going to go up, some months is going to come down. So on average, run rate is about INR 70 crores, INR 80 crores.
That should start from fourth quarter onwards, INR 70 crores, INR 80 crores, right?
That should start from, yes, somewhere in the -- in January, February, it should start.
So to specifically answer your question, as far as this financial year is concerned, we are looking at a turnover of about -- we're targeting a turnover of about INR 300 crores. And as far as the next financial year is concerned, as Vikas just said, INR 70 crores to INR 80 crores per month would be an average. That's about INR 800 crores give or take a few crores here and there for the next financial year.
Okay. And sir, when do we expect to start the work on Jewellery Park?
Jewellery Park, we have not yet got the notice to proceed. But we are expecting it in the month of December, we are expecting the notice to proceed. And then again, it will go into the design stage. So let's be fair and square not to expect much from this financial year itself.
So revenues will start flowing in from next year, second half?
Yes, next year second half.
Okay. Sir, any broad guidance for -- in terms of revenue from the project for FY '26?
Maybe about INR 50 [ crores ] a month. You see, by -- what will happen in this is that by the time the design is going to get complete, [ trains ] are going to set into Mumbai, Maharashtra next year. So that is what is going to happen in this case. I mean very honestly. Maybe next year, again, an average run rate of about INR 30 crores to INR 50 crores in the first few months. Then again, it is going to go up to that level of INR 70 crores, INR 80 crores.
Okay. Sir. And lastly, any issue on the working capital side from any particular states?
So as I mentioned during the last call, Bengal, Bihar were 2 states. Bihar working capital has actually improved. All our dues have been certified, and we should see them being cleared in this financial year, rest of the financial year. Bengal, we are not executing any government jobs as we speak. So -- and all the earlier jobs have been finished.
The next question is from the line of Samyak Jain from Marcellus Investment.
Sir, I understand that you are maintaining your revenue guidance at 15% for FY '25, but bringing down the CapEx guidance for the year. So just wanted to understand how will you maintain the pace of execution for this financial year?
It's an internal reworking that we've done. Some of our larger projects have gotten over. And as I mentioned earlier, we become -- we are conservative as far as new order inflow is concerned. So as a part of cost-cutting exercise that we have gotten into, once we've realized that the margins were down for the reasons as enumerated earlier by us.
So we are looking to reduce our CapEx expenditure as far as equipment and shuttering go. We are looking at -- as far as shuttering goes, we are looking at maybe going the rental route on some of our projects where we feel which are fast-track projects where we can use rented shuttering a quick in and out. So as a part of the overall strategy to cut costs.
Understood. And if the renting increases, will that further impact the margin? Or it will remain in the -- remain in the guided range?
We have an internal -- you can say the way we work out which projects can take renting where the profitability will not be impacted, which are fast-track projects, right. There, the projects which are to be finished in about a year, 1.5 years, at least the structured bit. So there we go the renting route.
The next question is from the line of Sani Roy, an Individual Investor.
Hello. Am I audible?
Yes.
So I just wanted to know that since we are targeting a 50-50 between the private and the public sector for our orders, what is stopping us from bidding for the private sector more than 50% given that the terms and conditions are much better and the trade receivables and the other margins and all and competitive intensity is much better against the public sector. So why aren't we increasing the private sector part in the order book?
Nothing is stopping us, but other than the scars of the last downturn. Earlier when the downturn hit the private sector, we -- a lot of contractors got [ waylaid ]. They lost -- actually companies got finished. So we don't want to put a lot of eggs in one basket. And while the going is good today, we -- as an infrastructure company, we are always at the forefront of cycles, be it upward cycle or downward cycle. So we're just being cautious.
Right, right. And sir, lastly, I mean like -- as mentioned by the previous caller that regarding the earlier cycle of 2002 to '08, if we compare that to this. So where are we in that cycle? Are we in the starting point? Are we in the midway? Where do you feel even though it's not comparable, where do you feel from the industry standpoint, we are -- the construction industry is compared to the last cycle? Is it in the midway or in the starting point now?
I think we are somewhere between the starting point and midway, but it would not be right to do a strict comparison because when the last cycle was there, the geopolitical situation was something else. Today, the world is flatter. What happens in America impacts us immediately. So it would not be fair to do a direct comparison.
If you would have asked me this question 1.5 months ago, I would have said we are just at the starting of this cycle. But today, I would like to say we are somewhere between starting and the midpoint. So we have to be cautious. That's what I'm saying.
Anybody who's not cautious, who throws caution to the wind and indiscriminately plans to grow, that's what actually we are seeing. There is a plethora of issues, which are coming out from construction -- for construction companies and in the real estate sector. So we don't agree with that line of thought. I think one has to be cautious going forward.
Sir thank you for the strong execution and the prudential approach. I've always been a long-term investor. So I wish you all the best, sir.
Thank you so much.
We have the next question from the line of Ketan Jain from Avendus Spark.
Sir, my question is on the Emaar settlement. How much of the money is received and yet to be received?
I think it's INR 56 crores to be received now.
Total.
Total, INR 218 crores. Out of this, INR 56 crores is to be received down.
INR 56 crores is pending.
The tranche that was to be received in this quarter has been received. That has been received so that the payment is happening as per schedule.
And how much in this quarter, is it?
This is INR 70 crores.
INR 70 crores. So it will get done by FY '25?
Yes, next tranche is due in January, the last tranche.
Okay. Okay, sir. Sir, my second question is on -- so I was just seeing your P&L in FY '19, '20 and '21. We have had a big bad debt provision -- bad debts written off in FY '20 and FY '21 worth of INR 42 crores and 53 crores. If you could tell us what does it pertain to? Which client does it pertain to?
That is also related to Emaar also. That time, we have taken a provision of INR 47 crore and various other parties was at that [ moment ], various parties are there.
Okay. So it's largely Emaar and other parties?
Largely Emaar, yes.
Ladies and gentlemen, we have no further questions at this time. I would now like to hand the conference over to the management for closing comments. Over to you, sir.
Thank you so much, everybody, for joining in. See you soon in about 3 months' time. Thank you. Thanks so much.
Thank you. On behalf of AMBIT Capital, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.